The United Bank is of the view that if there was a further hike in the rates, it might tend to have negative impact on the quality of the assets in question. It was announced by Mr. Bhaskar Sen, the Chairman and the Managing Director of the United Bank of India, that any further increase in the interest rates might mean having to compromise with the quality of the same.

There is soon going to be an announcement made by the Reserve Bank of India regarding the monetary policies of the bank. There are predictions made by the analysts as well as some of the senior bankers that there should be a hike of a slight percentage for the purpose of being able to fight the prevailing inflation crisis.

“Hike in interest rate will lead to repricing of loans. Project loans where the revised rate of interest will turn out to be higher than IRR (internal rate of return) could be under some stress”, he said. With many ups and down seen in the monetary arrangements, it’s just a matter of time to see what the future holds for the banks.